AMC posts narrower-than-expected loss, but CEO warns theater chain 'isn't out of the woods yet'

  • Shares of AMC Entertainment rose after the company posted a narrower-than-expected loss during the second quarter.
  • "AMC's journey through this pandemic is not finished, and we are not yet out of the woods," CEO Adam Aron said in a statement Monday.
  • As of the end of June, all of AMC's 593 domestic theaters were open to the public and 335 of its international theaters, or about 95%, were operational.

Shares of AMC Entertainment rose nearly 6% after the company posted a narrower-than-expected loss during the second quarter.

Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

  • Losses per share: 71 cents vs. 91 cents expected
  • Revenue: $444.7 million vs. $382.1 million expected

AMC posted a net loss of $344 million, or 71 cents per share, compared with a loss of $561.2 million, or $5.38 per share, a year ago. Analysts had expected the company to lose 91 cents per share, according to data from Refinitiv.

The movie theater chain reported revenue of $444.7 million, higher than the $382.1 million analysts had expected.

"AMC's journey through this pandemic is not finished, and we are not yet out of the woods," CEO Adam Aron said in a statement Monday. "However, while there are no guarantees as to what the future will bring in a still infection-impacted world, one can look ahead and envision a happy Hollywood ending to this story."

As of the end of June, all of AMC's 593 U.S. theaters were open to the public and 335 of its international theaters, or about 95%, were operational.

"We are not taking a victory lap … We are still losing money, we are still burning cash," Aron said during an earnings call Monday. "But we can see a light at the end of the tunnel."

Aron said the company expects to be profitable in the fourth quarter of 2021, as long as the domestic box office reaches at least $5.2 billion.

As of June 30, AMC had around $1.8 billion in cash and around $2 billion in liquidity available, the company said. These funds can be used by the company to buy or rent new theaters and to upgrade its already existing locations with better seating and amenities.

The company has begun to expand the number of screens it operates. During the second quarter, it took over leases at two Los Angeles locations: the 14-screen cinema at The Grove shopping complex in the Fairfax neighborhood and the 18-screen location at Americana at Brand in Glendale. Both were formerly operated by Pacific Theatres and are owned by real estate company Caruso. AMC didn't disclose the terms of the lease.

In 2018, The Grove theater was the second-highest grossing cinema and the Americana was the fifth-highest grossing cinema in the Los Angeles area. AMC is expected to reopen these theaters in August.

On Monday, Aron said the company was in the process of signing leases for as many as 10 more locations. Leases or letters of intent have been signed for six cinemas so far, he said. The theaters are located in Los Angeles, Chicago and Atlanta. Four more locations are being discussed, he said. Eight of the 10 possible locations are former Arclight and Pacific Theaters.

Aron also announced that by year end, AMC plans to have technology in place to accept bitcoin for movie tickets and concessions if paid for online.

For months, fans of the stock, who call themselves "apes," have helped drive the stock to record highs. These new investors have remained bullish on traditionally heavily shorted stocks like AMC and used their growing numbers to make waves on Wall Street.

Shares of the company have surged nearly 1,500% since January thanks to millions of these retail investors. However, the stock, which closed Monday at $33.80, has been halved since its high of $72.62 in early June.

This is a breaking news story. Please check back for updates.

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